AMORDEGRC

AMORDEGRC depreciation of an asset using French accounting conventions

Synopsis

AMORDEGRC(cost,purchase_date,first_period,salvage,period,rate,basis)

Arguments

cost: initial cost of asset

purchase_date: date of purchase

first_period: end of first period

salvage: value after depreciation

period: subject period

rate: depreciation rate

basis: calendar basis

Description

AMORDEGRC calculates the depreciation of an asset using French accounting conventions. Assets purchased in the middle of a period take prorated depreciation into account. This is similar to AMORLINC, except that a depreciation coefficient is applied in the calculation depending on the life of the assets.

The depreciation coefficient used is:

1.0 for an expected lifetime less than 3 years,

1.5 for an expected lifetime of at least 3 years but less than 5 years,

2.0 for an expected lifetime of at least 5 years but at most 6 years,

2.5 for an expected lifetime of more than 6 years.

Note

Special depreciation rules are applied for the last two periods resulting in a possible total depreciation exceeding the difference of cost - salvage. Named for AMORtissement DEGRessif Comptabilite. If basis is 0, then the US 30/360 method is used. If basis is 1, then actual number of days is used. If basis is 2, then actual number of days is used within a month, but years are considered only 360 days. If basis is 3, then actual number of days is used within a month, but years are always considered 365 days. If basis is 4, then the European 30/360 method is used.

See also

AMORLINC.